Question

Assure Corp. has recently organized. The company issued common shares to a lawyer who provided legal services worth

$7,500

to help organize the corporation. It issued common shares to another person in exchange for his patent with a market value of

$45,000.

In​ addition,

Assured

Corp. received cash both for

2,500

of its

$1.50

preferred shares at

$10.00

per share and for

35,000

of its common shares at

$12.50

per share. Without making journal​ entries, determine the total contributed capital created by these transactions.

The total contributed capital created by these transactions was

nothing.

Answer 1

Solution:
	Journal Entries
	Transaction	Account Title and explanation	Debit	Credit
	1	Legal Services	$                       7,500
		Common Stock		$                        7,500
		(Record the issue of Common stock for legal services)
	2	Patent	$                    45,000
		Common Stock		$                      45,000
		(Record the issue of Common stock for Patent)
	3	Cash	$                       2,500
		Preferred Stock		$                        2,500
		(Record the issue of Preferred stock)
	4	Cash	$                    35,000
		Common Stock		$                      35,000
		(Record the issue of Common Stock)